Fundamental Constitutive Agreement
Fundamental Constitutive Agreement

Bitbon System Public Contract

This document is a public offer agreement for users of the Bitbon System social network.

Contents

SECTION 1. GENERAL PROVISIONS

Provision 1. Scope of the Bitbon System Public Contract

1. Bitbon System Public Contract[i] (hereinafter — Agreement) is a social contract of constitutive nature of the Bitbon System social network (hereinafter — Bitbon System Community or Bitbon System Social Network) that establishes the basis of the Bitbon System[i] operation.

2. This Agreement identifies tasks and objectives of the Bitbon System Community, stipulates main terms and conditions for use, as well as for development of the Bitbon System infrastructure[i] and circulation of digital assets[i] in the Bitbon System.

3. Bitbon System Social Network[i] is a form of organization of the Bitbon System Community as a decentralized social network of economic relations that allows users to realize social relations using digital assets[i] via the Bitbon System infrastructure in accordance with the Bitbon System Public Contract. The Bitbon System is managed by Bitbon System Participants[i] (hereinafter — Participant) in the interests of all Bitbon System Users[i] (hereinafter — User) in accordance with the Appendix “Management of the Bitbon System” based on the Participant status[i], the role[i] and account rating[i] of the Participant, the combination of which determines the capabilities of each Participant in managing the Bitbon System Social Network.

4. The mission of the Bitbon System Community is to try to establish the balance of interests between a User and the state, the citizen of which he/she is, by modernizing social relations through development of an information technology mechanism to ensure trust between parties to such relations by using Bitbon System digital assets[i] (hereinafter — digital asset).

5. The Bitbon System Community only allows social relations that are realized in accordance with the terms and conditions established by this Agreement and the Appendices that are an integral part hereof, as well as protocols of digital assets[i] of Users.

6. This Agreement is a public offer of SIMCORD LLC (EDRPOU 37657823) as the first Bitbon System Operator[i] to an unlimited number of persons to form and develop the Bitbon System Community in accordance with the principles and conditions established by this Agreement.

7. Each Participant is a party to the Bitbon System Public Contract as a public offer agreement that establishes the rights and obligations of Participants, including those for the management of the Bitbon System.

8. Creation of a Bitbon System account[i] (hereinafter — account) shall mean acceptance of the offer from SIMCORD LLC (EDRPOU 37657823) to form and develop the Bitbon System Social Network, as well as registration of a new User in this social network.

9. The provisions of this Agreement are directly aimed at regulating relations between Users.

10. The provisions of this Agreement shall not regulate legal relations between Users that take place outside the Bitbon System.

11. Each User is fully and personally responsible for understanding and following any laws, rules and regulations of the jurisdiction he/she falls under that may be applicable to him/her due to using the functionality of the Bitbon System infrastructure.

Provision 2. Structure of the Bitbon System Public Contract

1. The structure of this Agreement[i] envisions a preamble, sections that consist of Provisions, which include paragraphs, and Appendices. The Agreement uses links and references to the Appendices.

2. The Appendices are an integral part of this Agreement (hereinafter — Appendices).

3. By their content, the Appendices cannot contradict this Agreement. In case of contradictions between the Provisions of this Agreement and Appendices, the Provisions of this Agreement shall prevail.

4. The Appendices to this Agreement include:

4.1. “Bitbon Protocol” (open)
4.2. “Terms and Definitions in the Bitbon System Social Network” (open)
4.3. “Management of the Bitbon System” (being prepared...)
4.4. “Funds of the Bitbon System” (open)
45. “Bitbon System Operator” (being prepared...)
4.6. “Bitbon System Provider” (open)
4.7. “Providing in the Bitbon System: Economic and Legal Decentralization of the Bitbon System” (open)
4.8. “Providing in the Bitbon System: Technological Decentralization of the Bitbon System” (open)
4.9. “Bitbon System Verifier” (being prepared...)
4.10. “Bitbon System Contributor” (being prepared...)
4.11. “Contributing in the Bitbon System” (being prepared...)
4.12. “Bitbon System Integrator” (being prepared...)
4.13. “Bitbon System Validator” (being prepared...)
4.14. “Bitbon System Specialist” (being prepared...)
4.15. “Making Amendments and/or Additions to the Bitbon System Public Contract” (open)
4.16. “Dispute Resolution Between Bitbon System Users” (being prepared...)
4.17. “Resolving Issues of Digital Asset Inheritance in the Bitbon System” (being prepared...)
4.18. “Bitbon System Account” (open)
4.19. “One Space Base Service” (open)
4.20. “AML/KYC Policy” (open)
4.21. “Privacy Policy” (open)
4.22. “Cookie Policy” (open)
4.23. “Digital Asset Creation Procedure in the Bitbon System” (being prepared...)
4.24. “Digital Asset Protocols in the Bitbon System” (being prepared...)
4.25. “Properties and Attributes of Digital Assets in the Bitbon System” (being prepared...)
4.26. “Components and Base Services of the Bitbon System” (open)
4.27. “Services of Bitbon System Users” (being prepared...)
4.28. “Moral and Ethical Code of the Bitbon System Community” (being prepared...)
4.29. “Rules of Digital Asset Circulation in the Bitbon System Social Network” (being prepared...)
4.30. “Service Fees in the Bitbon System: the Procedure for Their Deduction and Distribution” (open)

5. This Agreement and its Appendices are published on the official information resources of the Bitbon System[i] and come into effect right after their publication.

SECTION 2. NATURE OF THE BITBON SYSTEM

Provision 3. Bitbon System and Its Operation Principles

1. Bitbon System[i] is a decentralized information platform[i] that is managed by Participants[i] and allows Users[i] to realize social relations in the Bitbon System Social Network[i].

2. The Bitbon System infrastructure[i] allows the Bitbon System Community to modernize the process of realizing social relations in order to carry out equal and transparent relations in various global legal systems using decentralized digital registration of property and personal non-property rights in the Bitbon System. Such rights are registered in the Bitbon System through creation of digital assets[i] by Users and their subsequent disposal of property and personal non-property rights by means of digital asset circulation[i].

3. The nature of the Bitbon System is determined through its technological, economic and legal, as well as information and applied aspects.

4. The nature of the Bitbon System is based on the doctrine of natural law, which states that when property and personal non-property relations are realized, Users are free to choose the method used to record the expression of will of the parties, specifically to choose the form of the deal.

5. The form of deals in the Bitbon System[i] is a distributed ledger token transaction[i] (hereinafter — deal), which is accepted by the Bitbon System Community and ensured by the functionality of the Bitbon System infrastructure in accordance with the algorithm of the digital asset module[i].

6. In the Bitbon System, the moment of concluding a deal is the registration of a distributed ledger token transaction in the distributed ledger token accounting system[i] as a structural element of the Bitbon System through the implementation of digital asset module transactions.

7. In the Bitbon System, only Users are parties to a deal.

8. In the Bitbon System, transparency of deals is ensured by the Bitbon System infrastructure.

9. The nature of the Bitbon System is based on the fundamental principle, Right to the right[i], which allows a User to operate property and personal non-property right by means of digital asset units[i]. When operating property right by means of digital asset units, the property itself exists outside the Bitbon System with this User as its owner for the entire duration of this digital asset’s circulation in the Bitbon System.

10. A principle of value[i] integrity exists in the Bitbon System, which means that Users realize that their digital assets are a component of the Bitbon System as an integral value owned by all Participants.

11. A principle of noninterference exists in the Bitbon System, according to which the Bitbon System regulating relations of Users in the Bitbon System does not restrict their choice and implementation of relations outside the Bitbon System.

12. A principle of neutrality exists in the Bitbon System, according to which:

12.1. The Bitbon System is not a party, a third party or an arbiter in a potential dispute between Users as parties to the Contract on disposal of property that exists outside the Bitbon System, the right to which is exercised in the Bitbon System Social Network by means of a digital asset (hereinafter — Contract). Disputes that arise between Users within legal relations existing outside the Bitbon System are not regulated by this Agreement[i] and are considered in accordance with the norms of the applicable legislation of the countries, the jurisdictions of which such Users fall under, and/or by norms of international law. All data on the Contract is available to Users as parties to the Contract and may be used by such Users as proof of their legal positions in the dispute.
12.2. The Bitbon System is not a party to the agreement on services provided by means of the services of Bitbon System Users[i] (hereinafter — User’s service) and is not responsible for the quality of the services provided by such User’s services.

13. A principle of responsibility division exists in the Bitbon System, according to which:

13.1. A User is not responsible for actions of other Users when they are using the functionality of the Bitbon System infrastructure.
13.2. The Bitbon System represented by Bitbon System Operators[i] (hereinafter — Operator) is not responsible if Users violate the norms of the applicable legislation of the countries, the jurisdictions of which they fall under, when using the functionality of the Bitbon System infrastructure.

14. A principle of personal responsibility exists in the Bitbon System. If actions of a User directly contradict the principle of personal responsibility, this User is considered unconscientious and is responsible in accordance with the sanctions and restrictions envisioned by the Appendix “Moral and Ethical Code of the Bitbon System Community”. This principle is that each User is aware of his/her personal responsibility for:

14.1. Using only property, including property and/or personal non-property rights (hereinafter — property) owned by the User as property that he/she has the right to dispose of for the purposes of creating a digital asset.
14.2. Compliance with the norms of the applicable legislation of the country, the jurisdiction of which he/she falls under, including with regards to circulability of property, the right to which is exercised in the Bitbon System by means of digital asset circulation.
14.3. Data on property used by a User when creating a digital asset.
14.4. Compliance of the Contract and/or deal with the norms of the applicable legislation of the country, the jurisdiction of which this User falls under.
14.5. Compliance with the terms and conditions of the disposal of property established by the Contract.
14.6. Compliance with the terms and conditions of digital asset circulation established by a digital asset protocol[i].

15. A principle of presumption of authorship exists in the Bitbon System, which means that the Bitbon System Community recognizes the copyright of the creator of a digital asset. Authorship is considered legally reliable until proven otherwise. The Bitbon System infrastructure allows the Bitbon System Community to record copyright and guarantees protection of such rights.

16. A principle of irreversibility of deals exists in the Bitbon System, according to which, due to the technological nature of deals, the moment of distributed ledger token transaction indicates the conclusion of a deal and its proper execution. These facts are circumstances that do not need to be proven. Therefore, claims to terminate deals or invalidate them due to violation of the form of the deal and/or failure to conclude it, and/or its improper execution are impossible in the Bitbon System.

17. A principle of establishing access to digital assets exists in the Bitbon System, which is realized through the functionality of the Bitbon System infrastructure, in particular through the existence of the technical ability and authority for Operators to establish access of a User to digital assets he/she owns in cases specified in and in accordance with the Appendix “Bitbon System Account”. This principle allows Operators to safely for Users and the Bitbon System manage the process of disclosing and transferring data between base services of the Bitbon System[i] (hereinafter — base service) and/or services of Users, which is the foundation for establishing access to digital assets.

18. A principle of decentralization exists in the Bitbon System, which consists in three aspects:

18.1. Legal decentralization, which means that a User can obtain the Participant status and have equal rights to manage the Bitbon System without restrictions on citizenship, place or state of residence, i.e. international operation of the Bitbon System in the interest of the Bitbon System Community.
18.2. Economic decentralization, which means that Participants manage the Bitbon System infrastructure in order to organize and develop the decentralized economic ecosystem.
18.3. Technological decentralization, which means development of the decentralized technological scaling of the Bitbon System infrastructure by means of computing and telecommunication resources of Bitbon System Providers[i].

19. A principle of segregation of digital assets[i] exists in the Bitbon System, according to which all digital assets of Users are based on digital asset protocol forms[i], which predetermines the division of digital assets into types according to their individual and group features, which include: areas of application, restrictions on territoriality and/or objectivity, parties to Contracts and/or deals and other features. This principle allows Users to establish the terms and conditions for circulation of units of their digital assets in the Bitbon System.

20. A principle of balance of assets[i] exists in the Bitbon System, according to which the Bitbon System prohibits concluding Contracts, the contents of which can be interpreted as interest rate (borrowing rate or loan interest). Circulation of digital assets that have the mechanism violating the correlation between derivativeness[i] of digital asset units[i] and the original asset[i], as well as between the original asset and the initial asset[i] due to an increase in one of them without the simultaneous and equivalent increase in the others in the Bitbon System is impossible.

21. A principle of sovereign identity[i] exists in the Bitbon System, according to which every User independently disposes of his/her personal data and access to such data at his/her own discretion. The principle of sovereign identity is ensured by the Bitbon System infrastructure. Security and confidentiality of personal data of each User in the Bitbon System determine the security of the entire Bitbon System Community.

Provision 4. Management of the Bitbon System

1. SIMCORD LLC as the founder of the Bitbon System[i] issued 100,000,000.00 Bitbon units[i], which are used to exercise the right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (hereinafter — nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” or initial asset[i] for Bitbon) and access to the Bitbon Protocol information resource[i] (hereinafter — Bitbon Protocol information resource or original asset[i] for Bitbon). As a result of getting access to the initial asset for Bitbon and the original asset for Bitbon, a Participant[i] can exercise his/her right to manage the Bitbon System.

2. A Bitbon unit is an integral attribute of a Participant. Ownership of Bitbon units by a User[i] indicates this User’s status[i] of a Participant and rights to manage the Bitbon System.

3. The Bitbon System is managed by all of its Participants. All Participants are equal in their rights, and nobody can claim superiority and establish any other forms of managing the Bitbon System.

4. The Bitbon System is managed by its Participants in the interests of all of its Users in accordance with the Appendix “Management of the Bitbon System”.

Provision 5. Terms and Definitions in the Bitbon System Social Network

1. The Bitbon System Social Network[i] has its own system of terms and their definitions. A term can consist of several words, part of which can be independent terms with their own definitions.

2. When interpreting the terms of this Agreement[i], as well as when using them, one should refer exclusively to the definitions of these terms in the Appendix “Terms and Definitions in the Bitbon System Social Network”.

SECTION 3. KEY Element OF THE BITBON SYSTEM

Provision 6. Bitbon Digital Asset

1. Bitbon[i] is the key element of the Bitbon System infrastructure[i], which is software in the form of code for activating the base services of the Bitbon System[i] using Bitbon units[i] as a component of this software.

2. Bitbon, due to its nature, is a strictly limited resource of the Bitbon System[i] because it is limited to 100,000,000.00 Bitbon units.

3. Bitbon is a system-forming digital asset[i] created by SIMCORD LLC as a result of tokenization of the initial asset[i] for Bitbon.

4. Bitbon is a digital representation of the right to use the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” in accordance with the Bitbon Protocol information resource[i].

5. Bitbon is a method of accounting of the right to use the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” and access to the Bitbon System Social Network[i].

6. The final document of tokenization of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset[i] for Bitbon) is the Bitbon Protocol[i].

7. Bitbon Protocol connects the Bitbon Protocol information resource[i] (original asset[i] for Bitbon) and Bitbon units, as well as contains information about Bitbon, which is sufficient for circulation of the Bitbon digital asset[i] (hereinafter — Bitbon circulation) in the Bitbon System.

8. Bitbon Protocol shows the relevance and correspondence between:

8.1. Distributed ledger token data[i].
8.2. Original asset data[i]Bitbon Protocol information resource.
8.3. Initial asset data[i] — nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord”.

9. SIMCORD LLC as an Operator[i] oversees the execution of the Bitbon Protocol.

10. Bitbon as the key element of the Bitbon System ensures the ability of digital assets to circulate in the Bitbon System.

11. Bitbon is a part of the Bitbon Protocol information resource derivative of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord”, which is kept on the balance sheet of SIMCORD LLC as noncurrent property owned by SIMCORD LLC.

12. By its purpose, Bitbon is an instrument for implementation of management accounting of the right of access to the initial asset for Bitbon by SIMCORD LLC, specifically of the right to use the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” exercised by Participants according to the procedure established by the Bitbon Protocol information resource (original asset for Bitbon).

13. By its functional purpose, Bitbon is used to ensure:

13.1. The method of management accounting by SIMCORD LLC of the right to use the functionality of the Bitbon System infrastructure[i] by Participants.
13.2. Methods of financial and management accounting of their property and personal non-property rights by Users.
13.3. The method of exercising their rights to manage the Bitbon System by Participants.

14. For the purposes of financial accounting, Bitbon is defined as an intangible asset in accordance with the International Financial Reporting Standards (IAS 38).

15. SIMCORD LLC as the owner of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) shall not transfer ownership to this property to third parties during circulation of Bitbon unless such transfer is required to preserve property and/or the possibility of full use of property by Participants. The list of circumstances, order of legal successors, the method, procedure and other conditions are envisioned in the Appendix “Management of the Bitbon System”.

16. SIMCORD LLC as the owner of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) shall preserve the value of the property, which includes the ability to change property only by improving it.

17. SIMCORD LLC as the owner of the Bitbon Protocol information resource (original asset for Bitbon) shall not transfer ownership to this property to third parties during circulation of Bitbon and shall not change the procedure and method for using this property established by this Agreement[i] unless such transfer and/or changes are required to preserve property and/or the possibility of full use of property by Participants. The list of circumstances, order of legal successors, method, procedure and other conditions are envisioned in the Appendix “Management of the Bitbon System”.

18. SIMCORD LLC as the creator of Bitbon establishes unlimited circulation of Bitbon in the Bitbon System. The exercise of the right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) and access to the Bitbon Protocol information resource (original asset for Bitbon) is not limited in time.

19. SIMCORD LLC as the owner of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) does not set restrictions on the use of Bitbon.

Provision 7. Bitbon Unit

1. A Bitbon unit[i] is an instrument for accounting of the right to use the initial asset[i] for Bitbon[i] in accordance with the original asset[i] for Bitbon, as well as access for Users[i] to the Bitbon System Social Network[i] as Participants[i].

2. Bitbon units are a component of the Bitbon software and an instrument for determining the scope of access to specific functions of the base services of the Bitbon System[i] determined by the number of such units.

3. Due to the triune nature of the digital asset[i], a Bitbon unit provides:

3.1. Access to the Bitbon Protocol information resource[i] (original asset[i] for Bitbon).
3.2. Right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset[i] for Bitbon) in accordance with the Bitbon Protocol information resource.
3.3. Ability to keep records of access to the Bitbon Protocol information resource[i] (original asset for Bitbon) and the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon).

4. SIMCORD LLC as the owner of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon), owner of the Bitbon Protocol information resource (original asset for Bitbon), founder of the Bitbon System[i] and creator of Bitbon issued 100,000,000.00 Bitbon units, which represents 100% of rights of access to the initial asset for Bitbon and 100% of access to the original asset for Bitbon.

5. Out of the total number of Bitbon units issued in accordance with paragraph 3 of this Provision of this Agreement[i], SIMCORD LLC as the founder of the Bitbon System reserves 30,000,000.00 Bitbon units at the registration and storage address it owns (hereinafter — Assetbox[i]) to use them as a Participant and to create and implement innovative solutions, as well as maintain, update and develop the Bitbon System infrastructure[i].

6. Out of the total number of Bitbon units issued in accordance with paragraph 3 of this Provision of this Agreement, SIMCORD LLC as the founder of the Bitbon System transfers 70,000,000.00 Bitbon units to the Assetbox of the Bitbon System capitalization fund[i] for distribution through affiliated partners.

7. All Bitbon units that were not used from the Bitbon System capitalization fund before October 10, 2018 in accordance with paragraph 5 of this Provision of this Agreement remain in the Assetbox of the Bitbon System capitalization fund.

8. SIMCORD LLC has no rights to Bitbon units that it does not own.

9. Bitbon units are a unique for Bitbon ratio of distributed ledger token data[i], original asset data[i] and initial asset data[i] received as a result of tokenization of the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) and represented in the distributed ledger token accounting system[i] in the form of distributed ledger token accounting units[i].

10. The owner of Bitbon units has the right to use the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) in accordance with the original asset for Bitbon, which can be used or transferred by means of Bitbon units in accordance with the original asset for Bitbon.

11. Access to the Bitbon Protocol information resource (original asset for Bitbon) is represented in the right of a Participant to use this original asset.

12. The right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) is represented by the right of a Participant to use this initial asset in accordance with the Bitbon Protocol information resource (original asset for Bitbon). The scope of such right is determined by the number of Bitbon units owned by a specific Participant.

13. The right to use the Bitbon Protocol information resource (original asset for Bitbon) is exercised by Participants through the use of the Bitbon System infrastructure, including Bitbon System components[i] (hereinafter — component) and base services[i], as well as services of Users[i].

14. Bitbon units determine the exchange value of all digital assets[i] and ensure their circulability in the Bitbon System.

15. One Bitbon unit corresponds to 10-6 % of the scope of rights of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) and 10-6 % of access to the Bitbon Protocol information resource (original asset for Bitbon).

16. An indivisible part of one Bitbon unit is 0.00000001.

17. An indivisible part of one Bitbon unit corresponds to 10-14 % of the scope of rights of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) and 10-14 % of the scope of access to the Bitbon Protocol information resource (original asset for Bitbon).

18. The form of circulation of Bitbon in the Bitbon System is the assignment of a certain scope of the right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial asset for Bitbon) and scope of access to the Bitbon Protocol information resource (original asset for Bitbon). The form of recording Bitbon circulation in the Bitbon System is a distributed ledger token transaction[i].

19. During circulation of Bitbon, the User that received a certain number of Bitbon units receives all rights of the Participant established by this Agreement in proportion to the transferred scope of the right of access to the nonmonetary asset “Asset of the Bitbon System Infrastructure — Simcord” (initial access for Bitbon) and the scope of access to the Bitbon Protocol information resource (original asset for Bitbon). Therefore, this User acquires the status[i] of a Participant. The scope of this property right is measured in accordance with the Appendix Bitbon Protocol.

20. Additional issue of Bitbon units in the Bitbon System is impossible.

21. Users are subjects of legal relations of Bitbon circulation.

22. In the Bitbon System, each subject of legal relations of Bitbon circulation is an independent taxpayer that pays taxes when a taxation object occurs in accordance with the tax regulations of his/her country of tax residence.

SECTION 4. BITBON SYSTEM USERS

Provision 8. Bitbon System Users, Their Statuses and Roles

1. Each subject that completed the registration in the Bitbon System[i], as a result of which he/she received access to an account[i] that he/she uses to interact with the Bitbon System infrastructure[i] becomes a User[i].

2. Each User has the right to participate in one or several types of activity in the Bitbon System, as well as replace one type of activity with another at his/her own discretion if it does not contradict a specific digital asset protocol[i] and/or this Agreement[i].

3. In the Bitbon System, a combination of rights and obligations of a User in the Bitbon System Social Network[i] is determined by a status[i] that corresponds to a certain type of activity of this User in the Bitbon System, as well as a role[i] that determines the right of this User to access certain functionality of the Bitbon System infrastructure.

4. The following statuses are envisioned for Users in the Bitbon System:

4.1. Bitbon System Candidate[i].
4.2. Bitbon System Participant[i].
4.3. Bitbon System Operator[i].
4.4. Bitbon System Verifier[i].
4.5. Bitbon System Provider[i].
4.6. Bitbon System Contributor[i].
4.7. Bitbon System Integrator[i].
4.8. Bitbon System Validator[i].
4.9. Bitbon System Specialist[i].

5. The status of a Bitbon System Candidate allows a User to use the functionality of the Bitbon System infrastructure[i], access to which is not determined by mandatory ownership of Bitbon units[i].

6. The status of a Participant is automatically granted to a User who owns Bitbon units that he/she has the right to dispose of at his/her own discretion. The status of a Bitbon System Participant allows a User to use the functionality of the Bitbon System infrastructure, access to which is determined by mandatory ownership of Bitbon units, as well as to manage the Bitbon System in accordance with the Appendix “Management of the Bitbon System”. A Participant is always a User, but a User is not always a Participant.

7. The status of an Operator allows a User to manage the Bitbon System on behalf of all Participants in accordance with the Appendix “Bitbon System Operator”.

8. The status of a Bitbon System Provider (hereinafter — Provider) allows a User in the roles of a Registrator[i] and/or Partitioner[i] to maintain decentralization of the Bitbon System by providing his/her own resources for such purposes in accordance with the Appendix “Bitbon System Provider”.

9. The status of a Bitbon System Verifier allows a User to verify the account information of other Users in accordance with the Appendix “Bitbon System Verifier”.

10. The status of a Bitbon System Contributor allows a User in the roles of a Contractat[i], Stakeholder[i] and/or Bitup-Agency[i] to create and circulate digital assets of commercial projects in accordance with the Appendix “Contributing in the Bitbon System”.

11. The status of a Bitbon System Integrator allows a User in the roles of a Supplier[i], Developer[i] and/or Promoter[i] to integrate the Bitbon System infrastructure with external information systems[i] in accordance with the Appendix “Bitbon System Integrator”.

12. The status of a Bitbon System Validator allows a User in the roles of a Keeper[i] and/or Underwriter[i] and/or Guarantor[i] to ensure the adherence to the digital asset protocol[i] by its parties in accordance with the Appendix “Bitbon System Validator”.

13. The status of a Bitbon System Specialist allows a User in the roles of an Expert[i] and/or Master[i] to provide services to other Users by using his/her special knowledge and skills in accordance with the Appendix “Bitbon System Specialist”.

Provision 9. Digital Assets of Bitbon System Users

1. In the Bitbon System[i], all Users[i] have the right to create their own digital assets[i] to manage their property and/or personal non-property rights in order to record and dispose of them, in particular to perform equivalent exchange of such rights by means of digital asset units[i].

2. In the Bitbon System, property and/or personal non-property rights of Users are circulated by means of digital asset units[i] of such Users.

3. In the Bitbon System, due to the triune nature of a digital asset[i], distributed ledger token accounting units[i] are represented in the form of digital asset units in a 1:1 ratio. Accounting of digital asset units is done by means of distributed ledger token accounting units of this digital asset.

4. Digital asset is a type of a tokenized asset[i] and is essentially an instrument for implementing the methods of financial and/or management accounting of a User’s property in accordance with the scope of rights he/she has to this property.

5. Digital asset protocol[i] is the final document of tokenization of an initial asset[i] in the Bitbon System.

6. A Digital asset protocol is an independent registration object in the Bitbon System, which connects the digital asset information resource[i] and a digital asset unit and contains information about this digital asset, which is sufficient for digital asset circulation[i] in the Bitbon System.

7. A digital asset protocol shows the correlation between distributed ledger token data[i], original asset data[i] and initial asset data[i] as well as the relevance of such data.

8. Digital asset information resource[i] is property in digital form created by a User[i] as an original asset[i] during tokenization of the initial asset[i]. The properties of the digital asset information resource as property in digital form allow aggregating distributed ledger token data[i], original asset data[i] and initial asset data[i] with the possibility of their mutual correlation in the ratio established in the digital asset protocol[i]. Derivativeness[i] of the digital asset information resource from the initial asset[i] establishes the connection between the accounting of the data of the initial asset[i] as an inventory object for accounting of property that exists outside the Bitbon System[i] and the accounting of the original asset data[i].

9. Digital asset information resource as property in digital form exists in the Bitbon System throughout the entire circulation period of a specific digital asset.

10. In the Bitbon System, digital asset information resource is the result of intellectual activity of the creator of this information resource and belongs to the User who created this digital asset information resource as intellectual property.

11. In the Bitbon System, additional requirements may be envisioned for parties and concerned persons of Contracts of specific types of digital assets of Users regarding creation and circulation of such digital assets.

12. In the Bitbon System, distributed ledger token transaction[i] is the form of circulation of a digital asset. In the Bitbon System, circulation of digital assets of Users is ensured by the Bitbon circulation.

SECTION 5. BITBON SYSTEM INFRASTRUCTURE

Provision 10. Structural Elements of the Bitbon System

1. Bitbon System infrastructure[i] is a single software complex that consists of software, a combination of components[i] and base services of the Bitbon System[i] and ensures the Bitbon System[i] operation.

2. Bitbon System software[i] is source codes and executable modules, including those placed by the first Operator[i] in public repositories.

3. Bitbon System services include base services[i] and services of Users[i].

4. Components are an application or a group of applications being architecture elements of the Bitbon System infrastructure, which interact with each other ensuring the operation of base services of the Bitbon System and services of Bitbon System Users. The list of the main components is established in the Appendix “Components and Base Services of the Bitbon System”.

5. Base services are architecture elements of the Bitbon System infrastructure and are software complexes that provide Users[i] with access to certain functionality of this infrastructure in order for them to realize property and personal non-property relations using their digital assets[i]. The list of base services as well as the terms and conditions for using them are established in the Appendix “Components and Base Services of the Bitbon System”.

6. In the Bitbon System[i], components and base services allow Users to create services of Users in accordance with the Appendix “Services of Bitbon System Users”.

7. Service of a User is a software complex created by a User outside the Bitbon System and integrated with the specific functionality of the Bitbon System infrastructure in order to provide services to other Users while these Users are realizing property and personal non-property relations.

Provision 11. Account of a Bitbon System User

1. Account[i] is a component[i] created as a result of the registration of a subject in the Bitbon System[i] in order to get the rights of a User[i]. The terms of an account functioning as well as the procedure for its use by the User are regulated by the Appendix “Bitbon System Account”.

2. In the Bitbon System, in accordance with the algorithm specified in the Appendix “Bitbon System Account”, the Bitbon System Community creates an individual interval indicator of User’s activity represented in the form of account rating[i]. This indicator is a tool of the Bitbon System Social Network[i] that motivates Users to use the functionality of the Bitbon System infrastructure[i] more actively and for various purposes.

3. The main account elements include:

3.1. ID Passport[i] which is generated based on information provided by a User in order to be identified in the Bitbon System Social Network as a natural person in accordance with the Appendix “Bitbon System Account”. The following ID Passport categories[i] exist in the Bitbon System: “Anonymous”; “Beginner”; “Formal”; “Personal”; “Verified” or Corporate ID Card[i] which is generated based on information provided by a User as an authorized representative of a commercial or non-profit organization for the purpose of identifying this organization in the Bitbon System Social Network in accordance with the Appendix “Bitbon System Account”. The following Corporate ID Card categories[i] exist in the Bitbon System: “Commercial”; “Non-profit”.
3.2. Specialization Card[i] based on information provided by a User about his/her knowledge and skills in a certain area that can be confirmed by a Bitbon System Verifier[i] and/or evaluated by other Users. Specialization Cards are generated in accordance with the Appendix “Bitbon System Account”.
3.3. Account certificate[i] generated automatically based on the verified account information of a User contained in the ID Passport or Corporate ID Card of various categories and Specialization Cards, as well as based on the status[i] and role[i] required to provide this User with access to certain functionality of the Bitbon System infrastructure. Account certificates are characterized by certain types of User account certificates and account certificate indexes[i]. The list of all types of account certificates, account certificate creation principles and creation procedure are regulated by the Appendix “Bitbon System Account”.

4. By accepting this Agreement[i], a User guarantees that he/she has read this Agreement, understands and acknowledges its meaning and all the consequences that may occur due to violation of the Provisions of this Agreement in part or in full. When creating an account, a User accepts this Agreement and understands that this is a moment when the obligation to comply with this Agreement as a whole arises. A User is responsible for all actions within the Bitbon System, including for actions that were performed by this User as a result of misunderstanding and/or erroneous interpretation of this Agreement in part or in full.

Provision 12. Service Fees in the Bitbon System

1. In order to maintain and develop the Bitbon System infrastructure[i], the Bitbon System[i] envisions a service fee[i] paid by Users[i]. The service fee consists of two parts: infrastructure fee[i] and operation fee[i].

2. The infrastructure fee in the Bitbon System is part of the service fee for using the Bitbon System infrastructure, which is mandatory and deducted in Bitbon units[i], and shall be distributed as follows:

a. 40% shall be allocated to the first Operator[i] as the owner of the initial asset[i] for Bitbon[i];
b. 60% shall be deposited in the providing fund of the Bitbon System[i] for further distribution of remuneration among Providers[i].

3. Operation fee in the Bitbon System is part of the service fee for using services of a Bitbon System User[i].

4. The terms of collection, the procedure for calculating, deducting and distributing the service fee are established in the Appendix “Service Fees in the Bitbon System: the Procedure for Their Deduction and Distribution”.

Provision 13. Circulation of Digital Assets in the Bitbon System

1. In the Bitbon System[i], acquisition, transfer and/or exchange of digital assets[i] are performed through digital asset circulation[i].

2. Digital assets circulate in accordance with this Agreement[i] and the terms and conditions established in digital asset protocols[i].

3. In the Bitbon System, there are service fees[i] for circulation of digital assets deducted in Bitbon units[i] in accordance with the terms and conditions established in the Appendix “Service Fees in the Bitbon System: the Procedure for Their Deduction and Distribution”.

4. Users[i] can set additional fees for circulation of digital assets charged in digital asset units[i] of these Users.

5. During digital asset circulation, a User that received a certain number of digital asset units receives a certain scope of the right of access to the initial asset[i] and the original asset[i] for this digital asset in proportion to the transferred number of such digital asset units according to the procedure established by the digital asset protocol.

Provision 14. Funds of the Bitbon System

1. Funds of the Bitbon System[i] are components[i] intended for accumulating digital asset units from various sources envisioned by this Agreement[i] for further redistribution to solve the tasks specified during their creation. The list of funds of the Bitbon System as well as the terms and procedure for their creation, closure and other terms of their functioning are established in the Appendix “Funds of the Bitbon System”.

Provision 15. Ensuring Decentralization of the Bitbon System

1. Decentralization of the Bitbon System[i] is ensured by Users[i] by providing a certain number of their Bitbon units[i] and resources of proper quality that include communication channels, CPU time and memory for long-term storage of information in order to ensure the circulation of digital assets[i].

2. Activity aimed at ensuring decentralization of the Bitbon System (hereinafter — providing in the Bitbon System[i]) can be carried out by a User with the status[i] of a Provider[i] as a:

2.1. Registrator[i], which is a role[i] of a User with the status[i] of a Bitbon System Provider[i] that allows him/her to record deals[i] in order to confirm a legal fact by achieving consensus using the Community PoS algorithm in accordance with the Appendix “Providing in the Bitbon System: Economic and Legal Decentralization of the Bitbon System”.
2.2. Partitioner[i], which is a role[i] of a User with the status[i] of a Bitbon System Provider[i] that allows him/her to keep records of deals by providing his/her own computing and telecommunication resources in accordance with the Appendix “Providing in the Bitbon System: Technological Decentralization of the Bitbon System”.

3. Providers receive remuneration as a result of redistribution of Bitbon units performed by the providing fund[i] based on the resources used by each Provider in accordance with the Appendix “Bitbon System Provider”.

4. The fundamental principles and procedure of User’s activity with the status of a Provider, which regulate his/her rights and obligations in order to ensure circulation of digital assets and support of the Bitbon System infrastructure[i] and development of the decentralized execution environment of the Bitbon System, are established in the Appendices “Bitbon System Provider”, “Providing in the Bitbon System: Economic and Legal Decentralization of the Bitbon System” and “Providing in the Bitbon System: Technological Decentralization of the Bitbon System”.

Provision 16. Ensuring Segregation of Digital Assets in the Bitbon System

1. Segregation of digital assets[i] is envisioned in the Bitbon System[i], which is the division of digital assets[i] into types based on individual and group features of a digital asset.

2. Segregation of digital assets is ensured by the functionality of the Bitbon System infrastructure[i] intended for adherence to the digital asset protocol[i] by the parties to the Contract and/or deal[i].

SECTION 6. TRANSITIONAL PROVISIONS

Provision 17. Conditions of the Transition Period of the Bitbon System Development

1. Once this Agreement[i] comes into effect, the Bitbon System[i] shall develop under the terms of the transition period, according to which Participants[i] authorize SIMCORD LLC to perform the following actions:

1.1. Perform the duties of the first Operator[i] listed in the Appendix “Bitbon System Operator”.
1.2. With the status of a Provider in the role of a Partitioner, solely maintain and develop the Bitbon System infrastructure, using its own computing and telecommunication resources, as well as receive remuneration according to the procedure established in the Appendix “Bitbon System Provider” until February 1, 2027.
1.3. Manage the Bitbon System.
1.4. Make amendments and/or additions to this Agreement in accordance with Provision 18 of this Agreement.
1.5. Publish this Agreement as well as develop and publish the Appendices in accordance with Provision 2 of this Agreement in the order of their implementation in the Bitbon System.

2. The Participants authorize SIMCORD LLC to announce the end of the transition period within three years from the moment when the total number of Operators in the Bitbon System reaches 1,345 (one thousand three hundred forty-five), which will indicate the transition of the Bitbon System to fully decentralized management exclusively by Participants.

SECTION 7. FINAL PROVISIONS

Provision 18. Making Amendments and/or Additions to the Bitbon System Public Contract

1. Amendments and/or additions can be made to this Agreement[i] only if such amendments and/or additions shall not contradict the principles laid down in the operation of the Bitbon System[i].

2. The Provisions of this Agreement and/or its Appendices that are not published on the official information resources of the Bitbon System[i] shall not be applied by Users[i].

3. Amendments and/or additions to this Agreement can be made exclusively in accordance with the Appendix “Making Amendments and/or Additions to the Bitbon System Public Contract”.

4. Any amendments and/or additions to this Agreement, which have been brought to the attention of Users in any way not provided for in the Appendix “Making Amendments and/or Additions to the Bitbon System Public Contract” shall be void.

Provision 19. Term of the Bitbon System Public Contract

1. The term of this Agreement[i] is not limited in time or events.

2. This Agreement may be terminated unilaterally by a User[i] by annulling his/her account[i] in accordance with the Appendix “Bitbon System Account”.

3. This Agreement with a specific User may be terminated unilaterally by an Operator[i] by annulling the account of this User in cases directly envisioned by this Agreement and/or Appendices in accordance with the Appendix “Bitbon System Account”.

4. Changes in the parties to this Agreement by transferring a User’s access to his/her account to another person are forbidden. The Agreement with this User is considered terminated from the moment of such transfer.

5. Change in the number of Operators in the Bitbon System is the change in the number of authorized representatives of the Bitbon System[i] and does not entail the change in the party to this Agreement.

6. This Agreement comes into effect on March 10, 2018. Separate Provisions of this Agreement come into effect in accordance with the conditions of the transition period established in Provision 17 of this Agreement.

7. The moment when this Agreement comes into effect is the moment of launch of the Bitbon System.

Provision 20. Interpreting the Bitbon System Public Contract

1. Only Operators[i] shall provide official interpretation of this Agreement[i].

2. In case of any differences between various forms (printed, electronic, etc.) of this Agreement, the version available on the official information resources of the Bitbon System[i] in electronic form shall prevail.

3. The translation of this Agreement into other languages is provided on the official information resources of the Bitbon System for convenience of Users[i] only. In case of differences in understanding and/or interpreting this Agreement, the Russian version shall prevail.

Provision 21. Force Majeure

1. Functioning of the Bitbon System[i], in particular the uninterrupted operation of the Bitbon System infrastructure[i], may not be ensured due to a number of factors that may include force majeure.

2. Force majeure includes events that could not be predicted, specifically: fire, flood, earthquake and other cataclysms; wars, terrorist acts; actions of governments, legislative and executive bodies; strikes, civil unrest, riots, illegal actions of third parties; power outages and/or interruptions in the computer network; cyber attacks and other illegal actions; quarantine, pandemic, epidemic, epizootic; as well as other events that fall under force majeure and may affect the uninterrupted functioning of the Bitbon System, in particular uninterrupted operation of the Bitbon System infrastructure.

Provision 22. Risk Warning

1. By publishing this Agreement[i] on the official information resources of the Bitbon System[i], SIMCORD LLC as the first Operator[i] and founder of the Bitbon System[i] entirely fulfills its obligation to Users[i] with regard to providing proper information about the risks associated with activity available to Users when using the functionality of the Bitbon System infrastructure[i].

2. The Bitbon System is not responsible for consequences that may arise due to the Users’ use of their digital assets and/or digital assets[i] of other Users, regardless of whether or not the creation goal of such digital assets was achieved.

3. The Bitbon System is not responsible for actions and/or inactions of Users when conducting activity determined by their statuses[i] in the Bitbon System.

4. When accepting the offer from SIMCORD LLC to build and develop the Bitbon System Community, a User acknowledges and accepts all risks related to using the functionality of the Bitbon System infrastructure[i].

Provision 23. Security and Responsibility

1. In order to ensure security of the Bitbon System Community, Users[i] are advised to inform Operators[i] about all known instances of illegal actions related to using the functionality of the Bitbon System infrastructure[i] in accordance with the Appendix “Moral and Ethical Code of the Bitbon System Community”.

2. Due to its technological nature, the Bitbon System[i] cannot guarantee uninterrupted operation and access to the functionality of the Bitbon System infrastructure.

3. The Bitbon System disclaims, to the extent permitted by the applicable legislation, all guarantees and responsibility for any direct or indirect damage caused by using the functionality of the Bitbon System infrastructure.

4. The Bitbon System does not provide advice on compliance with legal requirements to a User when he/she is using the Bitbon System infrastructure.

5. Each User is personally responsible for understanding and personally evaluating if the use of the Bitbon System infrastructure complies with the legislation of the country, the jurisdiction of which this User falls under.

6. A User is personally responsible for following any advice and recommendations provided by the Bitbon System.

7. The Bitbon System is not responsible for improper and/or insufficient security measures of a User when creating and managing his/her account[i] and/or digital assets[i] by using the functionality of the Bitbon System infrastructure.

8. The Bitbon System is not responsible for ensuring protection of services of Users[i] including the use of various security measures.

9. The Bitbon System is not responsible for information distributed by Users outside the official information resources of the Bitbon System[i].

10. The Bitbon System does not control and does not guarantee anything with regard to operation of services of Users. The services provided this way are regulated by separate digital asset protocols[i] that ensure operation of such services.

Provision 24. International Standards and the Bitbon System

1. The Bitbon System[i] Community adheres to international standards in accordance with the Appendices “AML/KYC Policy” and “Privacy Policy”.

2. Events are registered in the Bitbon System in accordance with the Coordinated Universal Time (UTC).

Provision 25. Policy of the Bitbon System Community

1. No other ideology or policy other than the one provided on the official information resources of the Bitbon System[i] shall be established in the Bitbon System Community.

2. The relations between Users[i] shall be based on the principles set forth in this Agreement[i], in particular in the Appendix “Moral and Ethical Code of the Bitbon System Community”.