PECUNIX USER AGREEMENT

1. INTRODUCTION

1.1 This Agreement sets out the terms and conditions under which PECUNIX INCORPORATED will provide its services to Users and Users will be able to utilise the Pecunix System and the Pecunix Network. User must read this Agreement carefully and understand these terms and conditions prior to any use of the Pecunix Network. User acknowledges that by accessing the Pecunix System and/or creation of a User Account, User accepts and is bound by the terms and conditions of this Agreement without exception. If you have any concerns about this Agreement or the Pecunix System User should consult a legal adviser prior to using the Pecunix System.

2. INTERPRETATION

2.1 Unless otherwise expressly stated the words and expressions listed below shall have the following meaning:

Additional Users means any person, company, individual, corporation, trust or other entity accessing a User Account on the Pecunix Network with the authority (either real or apparent) of the User.

Agreement means the terms and conditions specified in this document.

Allocated Storage means Fine Gold contained in discrete and identifiable forms of physical bullion that meet the London Good Delivery Standard established by the London Bullion Market Association within the Repository

Auditors means a fully independent and suitably qualified international firm of Auditors appointed by Issuer to certify that the amount of Fine Gold held in Allocated Storage within the Repository on behalf of the Users corresponds exactly to the amount of Pecunix currency in circulation from time to time as recorded in User Accounts on the Pecunix System.

Available Gold Balance means the total mass of Fine Gold measured in grams in Allocated Storage within the Repository held on behalf of that User.

Available Pecunix Balance means the total value of Pecunix denominated in grams of Fine Gold recorded in a User Account.

Bullion Agent means the suitably qualified entity appointed by Issuer or Custodian to undertake duties related to the bailment and redemption of gold bullion into or out of Allocated Storage.

Custodian means the independent and suitably qualified entity appointed by Issuer to oversee the governance of the Fine Gold held in Allocated Storage which comprises the Fine Gold held for the exclusive benefit of Users.

Escrow Agent means the fully independent entity appointed by Issuer or Bullion Agent to certify:

(a) The acquisition and disposition of Fine Gold to be held in Allocated Storage within the Repository on behalf of the Users; and

(b) To the quality of the Fine Gold

Fine Gold means pure gold as measured by the rules required for London Bullion Market Association and recorded as "Fine Weight" on the weight list accompanying gold Good Delivery Bars

Issuer means PECUNIX INCORPORATED

Network means the Pecunix web site, its pages and general information.

Pecunix means an international digital currency underwritten at all times by a corresponding amount of unencumbered physical Fine Gold held in Allocated Storage within the Repository on behalf of the Users.

PECUNIX INCORPORATED is a registered legal corporate entity of the Republic of Panama.

Permissions means certain predetermined User Account access privileges granted by Primary User to designated Additional Users.

Primary User means the User that creates and/or opens a Pecunix User Account.

Private Identification Key or PIK means the 16 character code that is issued to the User by the Pecunix System and that the User or Additional Users use to access User's User Account.

Repository means the fully independent entity or entities that holds an accredited international gold storage rating that will hold the Fine Gold in Allocated Storage on behalf of the Users. 

Preferred Retail Exchange Operator or PREO means a fully independent and suitably qualified retailer of currencies including the Pecunix currency.

PAYMENT means the act of transferring value between Pecunix User Accounts. Payments are denominated in grams of Fine Gold and transfer the exclusive benefit of that precise mass of Fine Gold measured to an accuracy of one 10,000^th of a gram from the transferring User to the receiving User. 

System means the Pecunix secure digital User interface and electronic services provided by Pecunix that enable the User to access his User Account/s to make and receive Payments

User means any person, company, individual, corporation, trust or other entity accessing a User Account on the Pecunix Network and Users means each and every User collectively.

User Account means the electronic record of the quantity of grams of Fine Gold held on behalf of each User in Allocated Storage for the exclusive benefit of the User represented as an amount of Pecunix.

Login ID means a code name that is issued to the User by the Pecunix System and that the User or Additional Users use to access User's User Account.

3. GENERAL TERMS AND CONDITIONS

Pecunix SYSTEM

3.1 The Pecunix System is an Internet based system, which facilitates the conversion of Fine Gold into the digital currency known as Pecunix which can then be exchanged electronically between Users on the Pecunix System for the purposes of making or receiving Payments

3.2 User acknowledges that the Pecunix System is not an escrow service PECUNIX INCORPORATED provides no guarantee that vendors using the Pecunix System will fulfil purchase or supply orders. User acknowledges that the Issuer will not be liable in any way to User for the failure of purchase orders for goods or services to be successfully completed nor for the quality, safety or legality of any goods or service purchased using the Pecunix System.

PECUNIX INCORPORATED

3.3 User agrees that PECUNIX INCORPORATED will neither become involved in nor have any responsibility for any dispute between individual Users of the Pecunix Network.

3.4 The entity responsible for development, procurement, insurance and administration of the Pecunix System is PECUNIX INCORPORATED

3.5 PECUNIX INCORPORATED is not a bank and the Pecunix Network does not operate as a bank and therefore PECUNIX INCORPORATED nor the Pecunix System are in any way subject to any form of banking regulations in any jurisdiction.

PREOs

3.6 Exchange services (i.e. exchanging national currency to Pecunix and vice versa and other currencies to Pecunix and vice versa) are provided by independent Preferred Retail Exchange Operators (PREOs)

USERS

3.7 User holds title to the Pecunix in the User's User Account and the User maintains all rights and privileges over such Pecunix as if it were placed in the User's hand or other personal device for holding or storing money.

3.8 The Primary User is the User which establishes the User Account. Primary User may grant Permissions to Additional Users of their User Account. The Issuer will treat any and all such Additional Users as delegates of Primary User. Issuer is entitled to and will treat any person accessing a User Account using User's Private Identification Key(s) as the bona fide User of that Account.

3.9 Any disputes that arise between Users of a User Account are the responsibility of the Primary User of that User Account and not of PECUNIX INCORPORATED

3.10 User agrees to keep User's Private Identification Key(s) and Login ID private and secure at all times. User agrees that protection of User's Private Identification Key(s) and Login ID, which give access to User's Pecunix User Account, is the sole responsibility of the User. User acknowledges and agrees that Issuer is not liable for any loss in the event of the loss or misuse of User's Private Identification Key(s) and/or Login ID

3.11 User agrees that the only way to recover access to a User Account where the Private Identification Key(s) or Login ID have been lost is by following the password recovery procedure established by Issuer and as outlined at clause 13. User is responsible for being able to meet the requirements and costs for the password recovery. PECUNIX INCORPORATED will not be responsible in any way for any of User's losses due to User failing to meet the requirements for password recovery

TAMPERING

3.12 User agrees not to attempt to, tamper with, modify, reverse engineer, gain unauthorised access to, or in any way alter any software comprising the Pecunix System and/or the Pecunix Network.

3.13 If User uses, or attempts to use, the Pecunix System in connection with tampering, cracking, modifying or otherwise corrupting the security or functionality of the Pecunix Network or System, the Issuer reserves the right to disable the User Account of User. Additionally, User will be liable for any damages which may result from such action and the Issuer may take such other action against User as it deems appropriate including but not limited to criminal prosecution as well as the notification to the general public of User's actions (at the sole discretion of Issuer).

4. OBLIGATIONS OF ISSUER

Pecunix

4.1 Issuer will credit the User's Account with the precise amount of Pecunix equal to the Fine Gold (in the form of London Bullion Market Association Good Delivery Bars) bailed on behalf of that User into the Repository    

4.2 User acknowledges the critical importance of the London Bullion Market Association Good Delivery Standard and acknowledges that to maintain the integrity of the Pecunix System all gold bullion held in Allocated Storage to underwrite the Pecunix in the Pecunix System must meet the London Bullion Market Association Good Delivery Standards. Accordingly no bullion will be accepted into the Pecunix System and no Pecunix will be issued in respect of bullion which is not entered into the Pecunix System by Bullion Agent and approved by Custodian

4.3 Issuer will ensure that for all Pecunix in circulation from time to time (recorded in User Accounts on the Pecunix System) there is at all times an identical quantity of unencumbered Fine Gold held in Allocated Storage within the Repository  

4.4 Issuer will ensure that the Auditors carry out an independent audit of the Fine Gold held in Allocated Storage and the corresponding Pecunix in circulation at least every four months and the results of the audit will be published on the Pecunix Network.

4.5 Issuer will ensure that in all circumstances all Fine Gold in the Pecunix System is held for the exclusive benefit of Users in Allocated Storage within the Repository and is held clear from any claim that PECUNIX INCORPORATED or the operators of the Repository or any other entity may have. 

4.6 Issuer will appoint Custodian to oversee the governance of the Fine Gold held in Allocated Storage.

4.7 Issuer will procure that all the Fine Gold at the Fine Gold at the Repository is covered by insurance equal to the full replacement value of that Fine Gold against all risk other than war, civil insurrection, nuclear incident or government confiscation.

4.8 Issuer will accept and facilitate bailment and redemption of bullion, in accordance with procedures predetermined by this Agreement and Issuer, Custodian and Bullion Agent

4.9 Issuer will bear all storage fees and insurance costs for the Fine Gold stored on behalf of Users in the Repository

4.10 Without limiting clauses 7 and 11, Pecunix will make every possible effort to maintain an adequate level of service so User can access the functionality of User's User Account and the Pecunix Network.

4.11 Without limiting the right of Issuer pursuant to clause 3.13 and 16, Pecunix will not deny User access to the Available Pecunix Balance in User's User Account unless required by a Court with competent jurisdiction.

5. GOVERNANCE

5.1 Issuer acknowledges the fundamental importance of the integrity and governance of the Pecunix System and has appointed fully independent and suitably qualified entities to fulfil the roles of Custodian, Auditors, Bullion Agent, database/website operator and Repository.  Issuer reserves the right to replace each and any of these entities should they become unable or unsuitable to fulfil their designated roles but Issuer may only replace an entity with another entity with suitable qualifications and which is independent of Issuer.

6. PAYMENTS

6.1 Once a User Account is opened, a User may make or receive Payments to any other User Account and access the User's User Account to view and undertake administrative tasks.

6.2 User agrees that all Payments once initiated by User on the Pecunix System are final, non-reversible and irrevocable and as such the relevant deductions and additions will be made to the relevant User's Account.

6.3 User agrees that all Payments initiated on the Pecunix System by User from User's User Account are the responsibility of User, even if the instructions provided by User are incorrect or if the Payments are made by Additional Users.

6.4 The presumption shall be that all Payments are authorised by and are the liability of User and shall be binding on User. Issuer shall restore any value diverted from User's User Account only if User establishes to the satisfaction of Issuer that value was diverted from User's User Account due to a breach of security in the Pecunix System caused otherwise than by the deliberate or negligent acts, or omissions of that User or Additional Users.

6.5 A User may make Payments of any amount that is equal or greater than 0.0001 grams.

6.6 Payments will only be transacted where there is sufficient Available Pecunix Balance in the User's Account.

7. INDEMNIFICATION 

7.1 While Issuer will make every effort to ensure the Pecunix System is accessible at all times, Issuer makes no representation that User will always be able to access the Pecunix System or the User's User Account and User agrees that Issuer will not be held liable for any loss or damage, whether direct or indirect, resulting from the use, operation or performance of the Pecunix System and/or the Pecunix Network other than as a result of the deliberate or negligent acts or omissions of Issuer.

7.2 User agrees to indemnify and hold harmless PECUNIX INCORPORATED (and its directors, affiliates, officers, employees and agents), from and against any and all claims, losses, liabilities, damages, costs and expenses (including legal fees and costs) arising out of or related to breach of the terms and conditions contained in this Agreement, or from the use of the Pecunix Network by User and/or Additional Users to whom Primary User has granted Permissions. User agrees that PECUNIX INCORPORATED shall under no circumstances be liable to User for any damages of whatever nature, kind or description in any location of the world, except for any loss caused by negligence or wilful misconduct of PECUNIX INCORPORATED This indemnification shall be binding upon User, Additional User's and User's administrators, executors, heirs, successors, and permitted assigns.

8. INTELLECTUAL PROPERTY RIGHTS 

8.1 The User acknowledges that "Pecunix", "Honest Money" and "Money Refined" are Registered Trademarks of PECUNIX INCORPORATED and all related intellectual property rights including trademarks, service marks, trade names, copyright and other rights used or embodied in the Pecunix Network are protected by international trademark law and do not constitute material in the public domain.

8.2 User acknowledges any materials or information including but not limited to feedback, suggestions and ideas sent to PECUNIX INCORPORATED by any User will be deemed non-confidential by PECUNIX INCORPORATED. PECUNIX INCORPORATED shall be free to use any ideas, concepts, know-how or techniques contained in the information or materials for any purpose whatsoever without additional compensation to the supplier of such materials or information. PECUNIX INCORPORATED reserves the right to refuse to post and/or to remove any information or material, in whole or in part, that, in its discretion, is unacceptable, undesirable, inappropriate or in any way a violation of this User Agreement  

8.3 All information and material supplied by PECUNIX INCORPORATED or contained in the Pecunix Network are the protected copyrighted property of PECUNIX INCORPORATED. "Pecunix" and all titles, characters, names and graphics are the property of PECUNIX INCORPORATED and the User may not copy, distribute, exploit, modify, post, publish, reproduce, redistribute, store, transmit or upload such information in any form without the express prior written consent of PECUNIX INCORPORATED.

8.4 PECUNIX INCORPORATED may enforce its intellectual property rights to the fullest extent permissible under international law and any treaties that may apply. Any unauthorised use is strictly prohibited by this Agreement and may also constitute a violation of international law. Unauthorised modification of any information on the Pecunix Network may result in criminal prosecution.

9. PRIVACY AND CONFIDENTIALITY POLICY

9.1 PECUNIX INCORPORATED recognises the User's right to confidentiality and privacy.

9.2 Unless ordered by a Court of competent jurisdiction, Issuer shall not reveal User's contact or identifying information or transaction history to any third party.

9.3 Issuer will ensure that User has the ability to examine User's contact and identifying information and make updates and changes when necessary.

9.4 Issuer will not store any User details, including but not limited to account history, contact or identifying information, or Personal Identification Key(s) in unencrypted plain text under any circumstances.

9.5 User agrees that Pecunix has the right to monitor the Pecunix Network electronically from time to time in order to operate the System properly.

10. THIRD PARTY LINKS

10.1 Pecunix provides links to other web sites that may be of interest or of use to Users solely for the convenience of Users. Any such linked site does not constitute part of the Pecunix Network unless expressly stated. PECUNIX INCORPORATED is not responsible for the privacy practices, or the content of any such web sites.

10.2 User acknowledges and agrees that PECUNIX INCORPORATED (and its directors, affiliates, officers, employees and agents) give no warranties or representations in connection with any links to other web sites or the operations of those web sites and in no way guarantees the use of such web sites or the services offered, included but not limited to the services of any PREOs User must make their own enquiries and without limitation to the provisions of clause 7, User will not hold PECUNIX INCORPORATED liable for any loss, damages or expenses incurred by User for the use of any other web site or the services offered on such web sites.

11. OUTAGES & FORCE MAJEUR

11.1 User agrees not to hold PECUNIX INCORPORATED responsible for any damages, delays, failures in the transmission or losses resulting from situations beyond the control of PECUNIX INCORPORATED including but not limited to acts of God and nature, acts of terrorism, civil disobedience, lockouts, riots, social or economic upheaval, strikes, wars, or any breakdown in normal communications or utilities infrastructure services or any other cause beyond the reasonable control of PECUNIX INCORPORATED and to indemnify and hold harmless PECUNIX INCORPORATED against such damages, delays, failures in the transmission or losses.

12. FEES

12.1 Issuer reserves the right to assess and collect fees from User's User Account relating to Payments not exceeding 1% of the total value of each and every Payment, except that where a payment fee is due, a minimum fee charged to any account will not be less than 0.0001 grams. User may access their User Account or perform administrative tasks in respect of their User Account without incurring any fees or charges.

12.2 Bullion Agent reserves the right to charge an appropriate fee for shipping, handling and insurance costs incidental to the physical delivery of Fine Gold fabricated into either bars or coins in fulfilment of the User's redemption or bailment orders. User acknowledges that Bullion Agent may charge an additional predetermined fee for redemption of inventory items that command a market premium of value over their fine weight

12.3 Pecunix reserves the right to charge a account access key recovery fee.

13. ACCOUNT ACCESS KEY RECOVERY PROCEDURE

13.1 If a User has saved his PGP Key in his User Account, he can recover a lost Private Identification Key and Login ID using the PGP account access key recovery facility on the Pecunix Network. 

13.2 If the User has not saved his PGP Key in his User Account, Issuer will require that the User provide adequate documentation (as determined by Issuer) to prove that he is the owner of the User Account. The onus is on the User to supply documentation that exactly corresponds with the contact and identification details stored in the User's account.

14. OBSOLETE USER ACCOUNTS

14.1 Providing User continues to access a User Account the User's User Account will remain active. A User Account is deemed inactive if after 5 years the User Account has not been accessed on any occasion either on a passive basis or to transact a Payment (including automatic payments). 

14.2 If the User Account is deemed to be inactive pursuant to clause 14.1 and the Available Pecunix Balance in an inactive User Account is greater than 5 grams, Issuer will attempt to contact User through the identification and contact details stored in the User Account (but Issuer is not required to take any further action). If Issuer is unable to establish contact within three months through use of the identification and contact details stored in the User Account, or the Available Pecunix Balance in the inactive User Account is less than 5 grams, the User Account will be deemed to be abandoned, and will be closed. Any remaining Available Pecunix Balance will be forfeited absolutely and paid to PECUNIX INCORPORATED free from any claim by third parties.

15. ASSIGNMENT OF THIS AGREEMENT

15.1 All rights and interest of Issuer in this Agreement shall be continuous and shall inure FOR the benefit of the successors and assigns of PECUNIX INCORPORATED and all User’s rights and obligations assigns whether by merger, consolidation or otherwise and shall be binding upon User’s executors, administrators, heirs, successors and permitted assigns. PECUNIX INCORPORATED may assign this Agreement or any of its rights, obligations or duties under this Agreement at any time without the consent of User but only to an assignee that has agreed to be bound by the terms and conditions of this Agreement. User shall not delegate any obligations hereunder without the prior written consent of a duly authorised officer of PECUNIX INCORPORATED.

16. RIGHT OF ASSOCIATION AND TERMINATION

16.1 PECUNIX INCORPORATED reserves the right to refuse and/or limit access to the Pecunix Network and/or System or terminate the User's rights under the Agreement to use the Pecunix System/Network in respect of any particular individuals or entities, at its sole discretion, with or without cause.

16.2 Without limiting clause 16.1 in the event of any breach of this Agreement by the User or a rejection of a modification to the Pecunix System as provided by clause 17, PECUNIX INCORPORATED may in its entire and sole discretion cancel this Agreement and terminate the User's rights and privileges under this Agreement but without prejudice to any rights PECUNIX INCORPORATED has against User in respect of any antecedent breaches of this Agreement and notwithstanding the termination of this Agreement, clauses 7 and 8 of this Agreement shall remain in full force and effect and the User will remain bound by the terms of clauses 7 and 8 of this Agreement.

16.3 On termination of a User Account pursuant to clauses 16.1 or 16.2, Issuer will restrict further access to the Pecunix System/Network and/or to the User's terminated User Account so that no further Payments can be made or received and Issuer will make a Payment of the Available Pecunix Balance in the terminated User Account to an approved PREO provided on the Pecunix System so that User can exchange User's Available Pecunix Balance and exit the Pecunix System.

17. AMENDMENT, UPDATE, MODIFICATION & WAIVER

17.1 PECUNIX INCORPORATED reserves the right to amend, update and/or modify (with or without prior notice) this Agreement as needed or as required. Any amendment, update or modification of this Agreement at any time will be advised by written notice given through the Pecunix Network's web pages. Any such amendment or update to this Agreement supersedes and nullifies the previous agreement in effect. User agrees that use of the Pecunix Network after such notification of changes in this Agreement, indicates that User will be bound by all such changes. User will have the opportunity to reject such modification at the time of such modification. Any rejection of the amendment, updating or modification of this Agreement by the User shall constitute a termination of User's rights to access and use the Pecunix Network as outlined in clause 16.2 of this Agreement.

18. SEVERABILITY

18.1 In the event any one or more of the provisions of this Agreement shall for any reason be held to be invalid, or unenforceable by any court of competent jurisdiction, the remainder of this Agreement shall remain valid and enforceable. The enforceability of any such provision shall otherwise be unaffected and remain in full force in all other jurisdictions.

19. LAWS GOVERNING THIS AGREEMENT 

19.1 This Agreement is governed by and construed in accordance with Panama Law and the parties submit to the exclusive jurisdiction of the Panamanian Courts.

19.2 The failure of PECUNIX INCORPORATED to enforce strict compliance with any of the terms of this Agreement in a timely manner shall at no time be seen as a waiver of such power or right. Furthermore, any single or partial exercise of such power or right shall at no time preclude any other future exercise.

19.3 The rights and remedies of PECUNIX INCORPORATED as outlined in this Agreement are cumulative and are inclusive of all other rights or remedies available to PECUNIX INCORPORATED at law or equity.

20. DISCLAIMER

20.1 User agrees that the use of the Pecunix Network and/or System and related services by User is at the sole risk of the User. No warranties or representations of any kind are provided to User either express or implied except as are contained in this Agreement. This Agreement comprises the entire agreement between the parties.

Amendment - 2002-10-12