Last updated July 10, 2026

Terms of Service

Effective Date: July 10, 2026 · Last Updated: July 10, 2026

Welcome to Penny. These Terms of Service (these "Terms") are a legally binding agreement between you and Penny Labs LLC ("Penny Labs", "we", "us", or "our") governing your access to and use of the Penny iOS application, the website at https://pennylabs.net, and all related content, features, and services we provide (collectively, the "Service"). By downloading, installing, or using the Service, you agree to these Terms. If you do not agree, do not use the Service.

IMPORTANT NOTICE - ARBITRATION: THESE TERMS CONTAIN A BINDING INDIVIDUAL ARBITRATION PROVISION AND A WAIVER OF CLASS ACTIONS AND JURY TRIALS (SEE SECTION 18). EXCEPT WHERE PROHIBITED BY LAW, DISPUTES BETWEEN YOU AND PENNY LABS WILL BE RESOLVED BY INDIVIDUAL ARBITRATION, NOT IN COURT. YOU MAY OPT OUT WITHIN 30 DAYS AS DESCRIBED IN SECTION 18.

IMPORTANT NOTICE - AI-GENERATED CONTENT: PENNY IS AN ENTERTAINMENT APP. ALL CHARACTERS ARE FICTIONAL, AND EVERYTHING THEY SAY, SHOW, OR SEND IS GENERATED BY ARTIFICIAL INTELLIGENCE. YOU ARE INTERACTING WITH SOFTWARE, NOT A HUMAN BEING. CHARACTER RESPONSES ARE MADE UP AND SHOULD NOT BE TREATED AS FACT OR ADVICE.

Our Privacy Policy explains how we collect, use, and share information about you. The Privacy Policy is incorporated into these Terms by reference. Please read it.

1. Acceptance of Terms

These Terms apply to everyone who accesses or uses the Service. In these Terms, "Characters" means the AI-powered fictional characters available in the Service, and "Content" means all text, images, audio, and other material available on or through the Service, whether created by us, generated by AI, or submitted by users. Additional definitions appear in Sections 7 and 8. By creating an account (including an account created automatically when you first open the app), tapping "agree", or otherwise using the Service, you accept these Terms and represent that you are legally able to enter into this agreement. If you use the Service on behalf of another person or entity, you represent that you are authorized to bind them to these Terms.

2. Eligibility & Age Requirement

You must be at least 18 years old to use the Service. By using the Service, you represent and warrant that you are 18 years of age or older. The Service is intended for adults only. No one under the age of 13 may use the Service under any circumstances, and we do not knowingly collect information from anyone under 13.

We may ask you to verify your age at any time and may suspend your account pending verification. If we learn that an account belongs to someone under 18, we will terminate the account and delete its data in accordance with our Privacy Policy.

You also represent and warrant that: (a) you are not barred from using the Service under the laws of the United States or any other applicable jurisdiction; (b) you are not located in a country subject to a U.S. government embargo or designated by the U.S. government as a "terrorist supporting" country; and (c) you are not listed on any U.S. government list of prohibited or restricted parties.

3. Description of the Service; AI-Generated Content Disclaimer

Penny lets you have one-on-one conversations with AI Characters for entertainment. Depending on your subscription tier, the Service may generate text replies, voice messages, and images in response to your messages, and may let you browse and discover Characters, create personas that represent you in conversations, customize chats, and adjust Character personality and model settings.

Everything Characters say is made up. Character responses - including text, voice messages, and images - are produced by machine-learning models, not by humans. No Character is a real person, and no Character is affiliated with, endorsed by, or speaking for any real person. Any resemblance between a Character and a real person, living or dead, is coincidental unless clearly labeled as parody or fiction. Characters are not sentient, are not conscious, and are not capable of real emotions, relationships, or professional judgment, no matter how lifelike they may seem. The Service may display periodic reminders that you are interacting with AI.

AI outputs may be inaccurate, incomplete, fabricated, offensive, or inconsistent. You must not rely on anything a Character says as factual, and you should independently verify any information before acting on it. We may add, modify, or remove features, Characters, models, or other parts of the Service at any time without liability to you.

4. Not Professional Advice; Safety

Characters do not provide medical, mental-health, therapeutic, legal, financial, or any other professional advice or services. Nothing in the Service should be considered medical care, mental health services, counseling, or a substitute for care from a qualified professional. No Character is a licensed professional of any kind. If you need professional help, consult a qualified provider.

If you are experiencing a crisis, having thoughts of self-harm or suicide, or are in danger, stop using the app and get help immediately: call 911 (or your local emergency number), or call or text 988 to reach the 988 Suicide & Crisis Lifeline (United States). The Service may surface crisis resources in connection with certain content, but the Service is not a monitoring service and cannot summon help for you.

5. Accounts & Registration

An account may be created for you automatically when you first use the app, and we may offer additional registration or sign-in methods. Any account information you provide must be accurate and kept up to date. You are responsible for safeguarding your device and any credentials associated with your account, and for all activity that occurs under your account, whether or not authorized by you. Notify us at [email protected] if you suspect unauthorized use of your account.

You may maintain only one account, and you may not sell, rent, transfer, or share your account or access to it. You can delete your account at any time from within the app (Settings > Delete Account); deletion removes your account and associated data as described in our Privacy Policy.

6. Subscriptions, Billing & In-App Purchases

Free Tier and Penny Pro

The Service offers a free tier with limits on usage and features. We also offer Penny Pro, an auto-renewing subscription available in monthly and annual plans that unlocks additional features and higher usage limits. The title, duration, and price of each subscription plan are displayed in the app before you purchase. The features included in each tier may change over time as described in Section 3.

Auto-Renewal Terms (Apple In-App Purchase)

Subscriptions are purchased through Apple In-App Purchase and are subject to the following terms:

Payment is charged to your Apple Account at confirmation of purchase.
Your subscription automatically renews unless it is cancelled at least 24 hours before the end of the current billing period.
Your Apple Account is charged for renewal within 24 hours prior to the end of the current period, at the price disclosed at purchase (or as subsequently changed with notice in accordance with Apple's rules).
You can manage or cancel your subscription at any time in your device's Settings > [your name] > Subscriptions. Deleting the app does not cancel your subscription.
If we offer a free trial, the subscription converts to a paid subscription unless cancelled before the trial ends, and any unused portion of a free trial is forfeited when you purchase a subscription.

Refunds and Entitlements

All billing is handled by Apple. Refund requests are governed by Apple's policies and must be directed to Apple; Penny Labs does not process payments or issue refunds directly. Cancelling a subscription stops future renewals but does not entitle you to a refund or credit for any period already paid. Subscription entitlements are validated through RevenueCat, our subscription-management provider; you can restore previous purchases from within the app. If we ever offer virtual items or credits, they have no cash value, are non-transferable, are not redeemable for money, and may be modified or discontinued at any time.

7. User Content

"User Content" means everything you submit to the Service, including chat messages and prompts, personas (profiles you create to represent yourself in conversations), characters you create (if and when character creation is available), names, descriptions, images you upload, and any other material you provide.

You own your User Content. You grant Penny Labs a non-exclusive, worldwide, royalty-free, sublicensable license to host, store, reproduce, process, adapt (for example, reformatting), display, and transmit your User Content as needed to operate, provide, moderate, secure, and improve the Service and to enforce these Terms. This license ends when your User Content is deleted from the Service, except where retention is required by law or the content has been made visible to other users as described below.

Model training. Penny Labs does not use your chat content to train its own AI models. To generate Character responses, your messages and related context are processed by third-party AI providers as described in Section 13 and in our Privacy Policy.

You represent and warrant that you own or have all rights necessary to submit your User Content and grant the license above, and that your User Content does not violate any law or any third party's rights, including intellectual-property, publicity, or privacy rights. Personas are meant to represent you; you may not create a persona depicting a real third party without that person's consent. If character creation is available, characters you create must not impersonate real people without their consent, may be visible to other users, and are subject to moderation - we may edit their metadata, remove them, or restrict them at any time. Anything you elect to make visible to other users may remain available to those users even after you delete it or your account.

8. AI Generations (Outputs)

"Generations" means the outputs the Service produces in response to your User Content, including Character text replies, synthesized voice messages, and generated images.

Subject to your compliance with these Terms, Penny Labs assigns to you its rights, if any, in the Generations produced in your conversations, and you may use them for personal, non-commercial purposes. You may not sell Generations, use them to provide goods or services to others, or use them to develop, train, or improve any competing product or AI model. Because of how machine-learning models work, Generations are not guaranteed to be unique: the Service may produce the same or similar outputs for other users, and no rights are granted in any output to the extent it is identical or similar to another user's output.

You are responsible for the Generations you deliberately elicit and for how you use, save, and share them. Generated voices and images are synthetic media: they do not depict real people or real events, and you may not present them as authentic recordings, photographs, or statements of any real person. We make no warranty that Generations are accurate, original, appropriate, or non-infringing; they are provided "as is". As between you and Penny Labs, Penny Labs retains all rights, title, and interest in the Service itself, including its software, models, prompts, Characters, and systems.

9. Acceptable Use & Prohibited Conduct

You agree to use the Service only for lawful, personal, entertainment purposes. You may not, and may not attempt to:

Use the Service for any illegal purpose or to create, request, or share illegal content.
Create, request, or share any sexual content involving minors. We have zero tolerance for child sexual abuse material of any kind, including fictional, animated, or AI-generated depictions of minors and any sexualization of characters presented as minors. Violations result in immediate termination, and we report them to the National Center for Missing & Exploited Children (NCMEC) and/or law enforcement.
Create or share content that promotes self-harm, suicide, eating disorders, violence, or terrorism.
Engage in harassment, hate speech, threats, or bullying, or use the Service to demean, objectify, or abuse real people.
Impersonate any real person (including celebrities and private individuals), claim affiliation or endorsement without consent, or create deepfakes or other content that misrepresents a real person.
Reverse-engineer, decompile, extract, jailbreak, or probe the Service, its models, or its prompts; scrape or bulk-collect Content or Generations; or access the Service through bots or other automated means.
Circumvent or attempt to circumvent content filters, safety systems, rate limits, usage quotas, or age restrictions.
Resell, rent, or commercially exploit the Service or access to it.
Upload malware or malicious code, infringing material, or another person's personal data without authorization.

Violations may result in content removal, feature restrictions, or suspension or termination of your account without refund, in addition to any other remedies available to us.

10. Content Moderation, Reporting & Enforcement

We may use automated tools and human review to detect content that violates these Terms or the law. We have the right - but not the obligation - to monitor, review, remove, or refuse any Content, Character, or User Content at our discretion, and nothing in these Terms waives any protection available to us as a provider or user of an interactive computer service.

If you encounter content or a Character you find objectionable or believe violates these Terms, you can report it through reporting tools in the app, where available, or by emailing [email protected]. We review reports and act on violations in a timely manner. For any other concern about the Service, contact [email protected].

11. Intellectual Property & Feedback

The Service - including the Penny app, branding, logos, software, models, Characters, and all Content other than User Content - is owned by Penny Labs or its licensors and is protected by intellectual-property laws. Subject to these Terms, we grant you a limited, revocable, non-exclusive, non-transferable, non-sublicensable license to install and use the app for personal, non-commercial purposes on Apple-branded devices that you own or control, as permitted by the Apple Media Services Terms and Conditions (except that the app may also be accessed and used by other accounts associated with you via Family Sharing or volume purchasing, where available). All rights not expressly granted to you are reserved.

If you send us feedback, ideas, or suggestions, we may use them freely and without restriction, compensation, or attribution.

12. Copyright Policy (DMCA)

We respond to notices of alleged copyright infringement under the Digital Millennium Copyright Act. If you believe content on the Service infringes your copyright, send a notice to Copyright Agent, Penny Labs LLC at [email protected] including:

Identification of the copyrighted work you claim has been infringed;
Identification of the allegedly infringing material and information reasonably sufficient for us to locate it within the Service;
Your name, address, telephone number, and email address;
A statement that you have a good-faith belief that the use is not authorized by the copyright owner, its agent, or the law;
A statement, made under penalty of perjury, that the information in your notice is accurate and that you are the copyright owner or authorized to act on the owner's behalf; and
Your physical or electronic signature.

If your content was removed and you believe the removal was a mistake or misidentification, you may send a counter-notice to the same address containing your contact information, identification of the removed material and its location before removal, a statement under penalty of perjury of your good-faith belief that the material was removed in error, your consent to the jurisdiction of the federal district court for your address (or, if you are outside the United States, the District of Delaware) and to accepting service of process from the original claimant, and your signature. Unless the original claimant files a court action, removed material may be restored within 10 to 14 business days after we receive a valid counter-notice. We terminate the accounts of repeat infringers.

13. Third-Party Services

The Service depends on third-party providers to operate, including large-language-model inference via OpenRouter and its underlying model providers, image generation via Runware, voice synthesis via DeepInfra, infrastructure and authentication via Supabase and Cloudflare, subscription management via RevenueCat, and payment processing and distribution via Apple. Your messages and related context are transmitted to AI providers as necessary to generate Character responses, as described in our Privacy Policy. We are not responsible for the acts, omissions, or outages of third-party providers, and the Service may be interrupted or degraded when they fail.

You must comply with all applicable third-party terms when using the Service, including the Apple Media Services Terms and Conditions and the App Store terms of service.

14. Termination

You may stop using the Service at any time and may delete your account in-app (Settings > Delete Account). We may suspend or terminate your access to the Service, or any part of it, if we believe you have violated these Terms, if we are required to do so by law, to address legal or security risk, or if we discontinue the Service. Egregious violations - including any violation of the zero-tolerance rules in Section 9 - result in immediate termination without notice and without refund.

Upon termination, your license to use the Service ends and we may delete your account data in accordance with the retention practices described in our Privacy Policy. Sections that by their nature should survive termination do survive, including Sections 7 (as to the license in previously shared content), 8, 11, 12, and 15 through 22.

15. Disclaimers of Warranties

TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE SERVICE AND ALL CONTENT AND GENERATIONS ARE PROVIDED "AS IS" AND "AS AVAILABLE", WITHOUT WARRANTIES OF ANY KIND, EXPRESS, IMPLIED, OR STATUTORY, INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, NON-INFRINGEMENT, ACCURACY, AND UNINTERRUPTED OR ERROR-FREE OPERATION. WE DO NOT WARRANT THAT ANY OUTPUT OF THE SERVICE WILL BE ACCURATE, RELIABLE, OR APPROPRIATE, OR THAT THE SERVICE WILL PROVIDE ANY PARTICULAR ENTERTAINMENT OR EMOTIONAL VALUE.

Some jurisdictions do not allow the exclusion of certain warranties, so some of the above exclusions may not apply to you; in that case, any warranties that cannot be excluded are limited to the minimum scope and duration required by law. In the event of any failure of the app to conform to an applicable warranty that has not been effectively disclaimed, you may notify Apple, and Apple will refund the purchase price of the app (if any) to you; to the maximum extent permitted by law, Apple has no other warranty obligation whatsoever with respect to the app.

16. Limitation of Liability

TO THE MAXIMUM EXTENT PERMITTED BY LAW, PENNY LABS AND ITS OFFICERS, MEMBERS, EMPLOYEES, AGENTS, AND SUPPLIERS WILL NOT BE LIABLE FOR ANY INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, PUNITIVE, OR EXEMPLARY DAMAGES - INCLUDING EMOTIONAL DISTRESS, LOST PROFITS, LOST DATA, OR LOSS OF GOODWILL - ARISING OUT OF OR RELATING TO THE SERVICE OR THESE TERMS, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. WITHOUT LIMITING THE FOREGOING, PENNY LABS IS NOT LIABLE FOR ANY DAMAGES ARISING FROM YOUR RELIANCE ON ANY AI-GENERATED OUTPUT.

TO THE MAXIMUM EXTENT PERMITTED BY LAW, THE AGGREGATE LIABILITY OF PENNY LABS FOR ALL CLAIMS ARISING OUT OF OR RELATING TO THE SERVICE OR THESE TERMS WILL NOT EXCEED THE GREATER OF (A) THE AMOUNTS YOU PAID TO PENNY LABS FOR THE SERVICE IN THE TWELVE (12) MONTHS BEFORE THE CLAIM AROSE, OR (B) ONE HUNDRED U.S. DOLLARS ($100).

Some jurisdictions do not allow the limitation or exclusion of liability for certain damages, so some of the above limitations may not apply to you. These limitations apply to the fullest extent permitted in your jurisdiction and are fundamental elements of the bargain between you and Penny Labs.

17. Indemnification

You agree to indemnify, defend, and hold harmless Penny Labs and its officers, members, employees, and agents from and against any claims, damages, losses, liabilities, and expenses (including reasonable attorneys' fees) arising out of or relating to: (a) your User Content; (b) your use or misuse of the Service or any Generations; (c) your violation of these Terms; or (d) your violation of any law or the rights of any third party. We reserve the right to assume the exclusive defense and control of any matter subject to indemnification by you, in which case you agree to cooperate with our defense.

18. Dispute Resolution - Arbitration & Class Action Waiver

Please read this section carefully. It affects your legal rights, including your right to file a lawsuit in court and to have a jury trial.

Informal Resolution First

Before filing an arbitration or any other proceeding, you and Penny Labs agree to first try to resolve any dispute informally. Send a written notice describing the dispute and the relief you seek to [email protected]. The parties will negotiate in good faith for at least 60 days from receipt of the notice before either party may commence arbitration. This informal-resolution step is a condition precedent to arbitration.

Binding Individual Arbitration

Except as provided below, any dispute, claim, or controversy arising out of or relating to these Terms or the Service that is not resolved informally will be resolved by binding arbitration on an individual basis, administered by the American Arbitration Association ("AAA") under its Consumer Arbitration Rules then in effect. The Federal Arbitration Act governs this agreement to arbitrate. The arbitrator has exclusive authority to resolve any dispute about the interpretation, applicability, or enforceability of this arbitration agreement. Arbitration fees are allocated as provided in the AAA Consumer Arbitration Rules, and judgment on the award may be entered in any court of competent jurisdiction. If the AAA receives a coordinated set of substantially similar demands filed by or with the assistance of the same or coordinated counsel, the parties agree that the demands may be batched and resolved in staged proceedings consistent with the AAA's mass-arbitration procedures.

Exceptions

Either party may bring an individual claim in small-claims court instead of arbitration, and either party may seek injunctive or other equitable relief in court to protect its intellectual-property rights. Nothing in this section prevents you from reporting issues to federal, state, or local government agencies or prevents those agencies from acting on them.

Class Action and Jury Trial Waiver

You and Penny Labs each waive the right to a trial by jury and the right to participate in a class action, class arbitration, or any other representative or consolidated proceeding. Claims may be brought only in an individual capacity. If this class-action waiver is found unenforceable as to a particular claim, that claim (and only that claim) must proceed in court, and the remainder of this section remains in full force and effect.

30-Day Opt-Out

You may opt out of this arbitration agreement by emailing [email protected] within 30 days of first accepting these Terms, using the subject line "Arbitration Opt-Out" and including your name and a clear statement that you opt out of arbitration. Opting out does not affect any other provision of these Terms.

19. Governing Law

These Terms and any dispute arising out of or relating to them are governed by the laws of the State of Delaware, without regard to its conflict-of-laws rules, except that the Federal Arbitration Act governs Section 18. If you are a consumer residing in a jurisdiction whose laws grant you mandatory consumer protections that cannot be waived by contract, nothing in these Terms deprives you of those protections. Subject to Section 18, any claims not subject to arbitration must be brought exclusively in the state or federal courts located in Delaware, and both parties consent to personal jurisdiction and venue there.

20. Apple App Store Terms (Third-Party Beneficiary)

The following terms apply because the app is distributed through Apple's App Store:

Acknowledgement. These Terms are an agreement between you and Penny Labs only - not with Apple Inc. ("Apple"). Apple is not responsible for the app or its content, and Penny Labs, not Apple, is solely responsible for the app.
Scope of License. Your license to the app is limited to a non-transferable license to use the app on Apple-branded devices that you own or control, as permitted by the Usage Rules in the Apple Media Services Terms and Conditions, except that the app may be accessed and used by other accounts associated with you via Family Sharing or volume purchasing.
Maintenance and Support. Penny Labs, not Apple, is solely responsible for providing any maintenance and support services for the app. Apple has no obligation whatsoever to furnish any maintenance or support services for the app.
Warranty. Penny Labs is solely responsible for any product warranties, whether express or implied by law, to the extent not effectively disclaimed. In the event of any failure of the app to conform to an applicable warranty, you may notify Apple, and Apple will refund the purchase price of the app to you. To the maximum extent permitted by law, Apple has no other warranty obligation with respect to the app, and any other claims, losses, liabilities, damages, costs, or expenses attributable to a failure to conform to a warranty are Penny Labs' sole responsibility.
Product Claims. Penny Labs, not Apple, is responsible for addressing any claims by you or any third party relating to the app or your possession and use of it, including (i) product-liability claims; (ii) claims that the app fails to conform to applicable legal or regulatory requirements; and (iii) claims arising under consumer-protection, privacy, or similar legislation.
Intellectual-Property Claims. In the event of any third-party claim that the app or your possession and use of it infringes that third party's intellectual-property rights, Penny Labs, not Apple, is solely responsible for the investigation, defense, settlement, and discharge of the claim.
Legal Compliance. You represent and warrant that you are not located in a country subject to a U.S. government embargo or designated by the U.S. government as a "terrorist supporting" country, and that you are not listed on any U.S. government list of prohibited or restricted parties.
Third-Party Beneficiary. Apple and Apple's subsidiaries are third-party beneficiaries of these Terms, and upon your acceptance of these Terms, Apple has the right (and is deemed to have accepted the right) to enforce these Terms against you as a third-party beneficiary.
Developer Contact. Questions, complaints, or claims regarding the app should be directed to Penny Labs LLC at [email protected] or via https://pennylabs.net.

21. Changes to These Terms

We may update these Terms from time to time. If we make material changes, we will notify you in the app or by other reasonable means before the changes take effect and will update the "Last Updated" date at the top of this page. Your continued use of the Service after the changes take effect constitutes acceptance of the updated Terms. If you do not agree to the updated Terms, stop using the Service and delete your account.

22. Miscellaneous & Contact

Entire Agreement. These Terms, together with the Privacy Policy and any additional terms we present to you for specific features, constitute the entire agreement between you and Penny Labs regarding the Service and supersede all prior or contemporaneous agreements on that subject.

Severability. If any provision of these Terms is held invalid or unenforceable, that provision will be enforced to the maximum extent permissible, and the remaining provisions will remain in full force and effect.

No Waiver. Our failure to enforce any provision of these Terms is not a waiver of our right to enforce it later.

Assignment. You may not assign or transfer these Terms or your account. We may assign these Terms without restriction, including in connection with a merger, acquisition, sale of assets, or by operation of law.

Force Majeure. We are not liable for any delay or failure to perform caused by events beyond our reasonable control, including natural disasters, war, terrorism, labor disputes, governmental action, or failures of third-party providers, networks, or utilities.

Export Compliance. You may not use or export the app except as authorized by United States law and the laws of the jurisdiction in which you obtained it. You agree to comply with all applicable export and re-export restrictions, including U.S. embargoes and restricted-party lists.

Contact. The Service is operated by Penny Labs LLC, a United States limited liability company. For questions about these Terms or the Service, contact us at [email protected] or visit https://pennylabs.net.